VGX Token

Casey Wagner

This is a segment from the Forward Guidance newsletter. To read full editions, <a href="https://blockworks.co/newsletter/forwardguidance" target="_blank" rel="noreferrer noopener">subscribe</a>.



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US equities and bitcoin were in the red Tuesday afternoon as conflict in the Middle East stretched into a fifth day. Investors are also waiting to hear from the FOMC tomorrow about their interest rate decision and, more importantly, what the committee’s latest Summary of Economic Projections has to say.&nbsp;



Bitcoin had lost 2.7% over the day at 2 p.m. ET, hovering around $104,000. The S&amp;P 500 and Nasdaq Composite opened lower and were trading 0.8% and 0.9% lower, respectively, at that time.&nbsp;



All signs point to the Fed holding interest rates tomorrow. And probably again in July. Should the Israel-Iran conflict lead to sustained higher oil prices, the FOMC’s timeline for cutting rates could be delayed further.&nbsp;



Speaking of that timeline, we’ll know a lot more tomorrow. The updated dot plot will tell us where committee members see rates ending 2025, plus where they think the unemployment rate, GDP and PCE are headed.&nbsp;



In March, most FOMC members reported expecting interest rates to land at 3.75–4% by the end of 2025. With the current rate being 4.25–4.5%, this means committee members expected two 25 basis point cuts (or one 50bps decrease) by December.&nbsp;



We know that the first few post-Liberation Day inflation data points have come in mild, milder than committee members had expected. Even so, should the market’s expectations for inflation increase, the Fed is going to get concerned. When businesses and consumers expect prices to rise, it’s like a self-fulfilling prophecy.&nbsp;



It’s also worth noting that Chair Powell is probably in his final lap as head of the Fed. His term ends on May 23, 2026, and based on Trump’s past comments, we doubt Powell will be renominated.&nbsp;



There are eight (including this week’s) FOMC meetings between now and Powell’s presumed departure.



Secured overnight financing rate futures, which provide an avenue for investors to bet on the future of monetary policy, suggest that markets envision Powell cutting rates before the end of his term. Trading volumes on June 2026 options contracts have increased in recent months, per CME Group data.&nbsp;



Historically, though, outgoing Fed Chairs tended to spend their final year being more hawkish. Janet Yellen raised rates three times in the last 12 months of her term. Alan Greenspan, whose final year as Chair was in 2005, issued four hikes. Of course, these were during times of stable growth and low inflation.&nbsp;



In Powell’s case, the most hawkish move of all would be to raise rates this year. We (and markets) are all but certain that will not happen. What he might do instead, which would still be fairly hawkish, would be to delay rate cuts. “Higher for longer.”&nbsp;&nbsp;



All that said, should you buy options? I’m not in the business of offering investment advice, so I’ll hold my tongue, mostly.&nbsp;



My advice is to wait until Powell’s press conference tomorrow. We’ll have a better idea of what the Fed Chair is thinking then.



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Federal Reserve

FOMC preview: What to expect in Powell’s final months

Kate Irwin

This is a segment from The Drop newsletter. To read full editions, <a href="https://blockworks.co/newsletter/thedrop" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Decentralized cloud computing provider io.net, which has its own IO token, is working with the <a href="https://blockworks.co/news/mysten-labs-walrus-decentralized-gaming">Walrus</a> team to let startups train, run and store their own custom AI models.



IO offers a network of GPUs for AI training and fine-tuning, while Walrus is enabling AI model storage in the deal. The integration will be available as a pay-per-use offering, meaning builders are only charged for the amount of storage and computing power they use.&nbsp;



This Bring Your Own Model (<a href="https://www.walrus.xyz/blog/io-net-builds-ai-ml-compute-on-walrus?utm_source=twitter&amp;utm_medium=organic&amp;utm_campaign=walrus">BYOM</a>) offering lets AI agent devs or AI app builders develop and operate AI models without needing to set up their own data centers or hardware to do it.



IO says it has <a href="https://x.com/ionet/status/1933585865852207428">over 10,000 GPUs</a> and CPUs globally.



Walrus and IOo’s BYOM offering will have to compete with other AI developer cloud services, though, like those from Bittensor, Lambda, Spheron, Akash, Gensyn, Vast AI, and Google’s Vertex products.&nbsp;



“Traditional centralized cloud models are not only expensive — they come with significant privacy risks and limited composability options that are challenging for developers who prioritize decentralization,” said Rebecca Simmonds, Managing Executive at Walrus Foundation.&nbsp;



“By leveraging our decentralized data storage solution, io.net will be able to provide the necessary compute power for advanced AI and ML development without any of the drawbacks of traditional models, making this a clear win for developers, users, and the entire Web3 industry,” the exec continued.



The internet can feel very centralized when giant cloud services experience outages, like what <a href="https://status.cloud.google.com/incidents/ow5i3PPK96RduMcb1SsW">happened to Google</a> last week (and impacted <a href="https://blog.cloudflare.com/cloudflare-service-outage-june-12-2025/">Cloudflare</a> as well as a range of other apps and sites). That’s one obvious reason why centralized AI compute might not be ideal.



Walrus’s mainnet launched in March, with its main pitch being programmable, decentralized storage. The Walrus Foundation announced a raise of <a href="https://www.walrus.xyz/blog/walrus-foundation-fundraising">$140 million</a> that month.



More broadly, the need for computing power for AI is expected to keep increasing annually. McKinsey researchers <a href="https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/the-cost-of-compute-a-7-trillion-dollar-race-to-scale-data-centers">predict</a> that data centers are going to need $6.7 trillion globally to keep up with demand by 2030 (though there’s a range of possible scenarios they modeled below).



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdeE3FMjbeJu8JoUEwwOTegZVTaMJz6gbSiu-x-rj5KykoEnoagSm6dJLiBBXEv6KSZcVmu4SdyqiVBWH-xYl7Hh4-X0zfD6nYeQi6GrW3jP4bIdzxMsP5xME1Ibo56cOPkBSUa-w?key=g-Zjg6ACpeSZexUcVepx6g" alt=""/></figure>



AI compute is expected to need $5.2 trillion in investments to keep up with current demand in the next five years, while non-AI IT apps are expected to need much less than that at $1.5 trillion.



Walrus’s AI storage offering with IOo could help the Sui-based storage protocol see more adoption from AI builders and app devs, even from those outside of the crypto space. 



The Walrus mainnet currently has 4,167 TB in total storage capacity, with about 26% of that being used right now. The protocol has <a href="https://walruscan.com/mainnet/home">103 total</a> operators across 121 storage nodes.



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blockchain

Walrus, IO bring GPUs and decentralized storage to AI builders

Macauley Peterson

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/0xresearch" target="_blank" rel="noreferrer noopener">subscribe</a>.



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EigenLayer today launched EigenCloud, a developer platform designed to bring crypto-economic trust to any application, whether on- or off-chain. The product debuts alongside a fresh $70 million investment from a16z, bringing the venture firm’s total commitment to over $170 million.



We’ve <a href="https://blockworks.co/news/eigenlayer-restaking-mantle-zksync">previously covered EigenDA</a>, but today’s launch brings two additional service offerings to the fore: EigenVerify and EigenCompute.



The gist is to bring EigenLayer closer toward a full-fledged crypto’s AWS: a verifiability layer for Ethereum that combines off-chain execution with onchain guarantees. The protocol is already stocked with $12 billion in restaked assets, namely ETH. This TVL has, of course, fluctuated in USD terms with the ETH price, but has remained remarkably sticky in ETH terms.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXf0bNR-EDg7GQV81XODzJeQCcqkcMN4HLSldZYirUvkiX-UtchyadWWoUriq9vtHK8F06d0Zt7hP5NNkqHmpL31UCbbCZDjI-Ch4tVQiMFkT_yNXx8-AmZLQcC4fr-d7rPlNsx9hA?key=NkCplN3EhAv5Yb7PMKid1Q" alt=""/><figcaption class="wp-element-caption">Source: <a href="https://defillama.com/protocol/eigenlayer?denomination=ETH">DefiLlama</a></figcaption></figure>



EigenCloud promises a new generation of applications across AI, media, gaming and finance, with key features focused on provability: the what-when-why something happened.



For instance:



<ul class="wp-block-list">
<li>AI agents that issue proofs for model inference or decision paths</li>



<li>Oracles and games where disputes are crypto-economically resolvable</li>



<li>Memecoins whose mechanics are enforced by programmable slashing</li>



<li>Media feeds immune to deepfakes or manipulated news</li>
</ul>



In short, any Web2 application that needs trust, but doesn’t need to be its own L1 chain.



<h2 class="wp-block-heading">EigenCloud components</h2>



<ul class="wp-block-list">
<li>EigenDA: A high-throughput data availability layer offering &gt;10 MB/s throughput. Think of it as a turbocharged alternative to Ethereum’s blobspace, ready for rollups and content-heavy workloads.</li>



<li>EigenVerify: A programmable dispute resolution system. Developers can specify fraud or correctness conditions, and violations are punished through slashing.</li>



<li>EigenCompute: Verifiable off-chain compute-as-a-service that abstracts, for instance, node management and links crypto-economic guarantees to general-purpose workflows.</li>
</ul>



Together, these primitives give developers a sort of plug-and-play access to verifiability, piggybacking on Ethereum’s validator infrastructure.



<h2 class="wp-block-heading">The risks</h2>



A compelling vision, to be sure. But it’s also early for practical applications and risks abound.



Much of EigenLayer’s TVL ramp-up was driven by airdrop speculation, and built up before slashing was enabled in April. But capital can flee just as fast as it arrived.



Second, critics (<a href="https://blockworks.co/news/restaking-ticking-time-bomb-eth">including Vitalik Buterin</a>) have warned about restaking contagion, potentially putting Ethereum&#8217;s social consensus between a rock and a hard place. However, EigenCloud’s primitives are secured by a separate operator set distinct from Ethereum’s core validators, so slashing on EigenLayer does not affect Ethereum consensus. Its architecture prevents a single unit of stake from being slashed multiple times across services, with cryptoeconomic guarantees underwritten by the EIGEN token.



Rival Symbiotic’s risk model is a bit different still, with <a href="https://docs.symbiotic.fi/intro/stake/">isolated vaults</a> and per-network slashing parameters. Since each vault operates independently, a failure in one vault does not cascade across all restaked funds.



Third, governance has a relatively big role. With a16z funding both the infrastructure and many of the AVSs it secures, some worry about ecosystem capture.



EigenCloud enters a crowded field, aside from Symbiotic. EigenDA competes with data availability networks like Celestia and Avail, and there are similar compute systems like Gensyn and Akash.&nbsp;



A select group of developers are getting access to EigenCloud today, including Securitize, which will use EigenVerify to validate pricing data for BlackRock’s $2 billion BUIDL fund. Broader access and staking rewards are expected to follow in waves.



The a16z $70 million token purchase sounds impressive, but it has a massive $4.5 billion fund, so it brings its bet to only about 3.7%.



If EigenCloud can execute on its promise, it could finally bridge the gap between Web2 flexibility and Web3 trust. But it still needs to prove that real slashing, decentralized governance and non-DeFi use cases will actually work and scale.



Correction, June 17, 2025 at 3:06 pm ET: Updated the slashing risks section to correctly reflect the current architecture.



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0xResearch Newsletter

EigenCloud launches aiming to bring verifiability to everything

Katherine Ross

This is a segment from the Empire newsletter. To read full editions, <a href="https://blockworks.co/newsletter/empire" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Five months ago, Gemini and the CFTC <a href="https://www.reuters.com/technology/gemini-agrees-5-mln-fine-injunction-over-cftc-charges-filing-shows-2025-01-06/">agreed to a settlement of $5 million</a> related to a 2022 lawsuit from the CFTC <a href="https://www.cftc.gov/PressRoom/PressReleases/8540-22">alleging</a> that the crypto exchange made false or misleading statements about a bitcoin futures contract it wanted to launch.&nbsp;



Gemini sent a letter via its lawyers to the CFTC’s Inspector General Christopher Skinner alleging that the Division of Enforcement (DOE), which led the suit, didn’t act in good faith.



The 13-page document claims the DOE “was not motivated by a principled application of the law or a desire to protect the commodities markets.”



The letter alleges, instead, that the individuals involved in Gemini’s case sought to go after Gemini in the hopes of gaining a legal win. But Gemini’s not the only one who’s been critical of the DOE recently.&nbsp;



A court sanctioned the <a href="https://blockworks.co/tag/cftc">CFTC</a> back in May in a case led by the regulator against Traders Global Group. This led to acting chairman Caroline Pham <a href="https://www.cftc.gov/PressRoom/PressReleases/9074-25#:~:text=Proactive%20CFTC%20Remediation%20and%20Reform,leverage%20expertise%20and%20reduce%20siloing.">making a public statement</a> about her concerns with the DOE and the efforts she’s since undertaken to reorganize it.&nbsp;



Now <a href="https://blockworks.co/tag/gemini">Gemini</a> is making its own public statement, alleging that DOE staff failed to provide any evidence proving that information was omitted about the bitcoin futures contract.&nbsp;



(The background of this is that an ex-employee, who was terminated, allegedly lied to the CFTC in a whistleblower report that led to this whole suit.)



Its letter directly referenced the case above, noting that the DOE also tried to “downplay its wrongdoing” to the Commission.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXe3v2TfAGFG1EBJNW_j6Bu8bQ0Tqu0odJymnZ7eI2JWbwnFVbcUwKVclNfnFTgtEVaxhANjF_havYsxhs0vpczXRWbj-awjBDSYFDtP-aPvkenKv6_J6xMLWnatBQA2jaabXRv17A?key=dn8MjfZEBB2ayQ0bk5_5MA" alt=""/><figcaption class="wp-element-caption">Source: letter from Gemini’s lawyers to Inspector General Skinner</figcaption></figure>



Gemini said it got to the point where it had “no choice” but to agree to the $5 million settlement.



“Gemini Trust did not settle because it did anything wrong…For nearly seven years, the DOE Staff subjected Gemini Trust to abusive investigation and litigation. As detailed above, the DOE Staff took extraordinarily aggressive legal positions and abused special governmental privileges in order to substantially hinder Gemini Trust’s ability to defend itself,” Gemini claims.&nbsp;



It is important to note that while Gemini agreed to a permanent injunction, it did not admit or deny the CFTC’s allegations. However, that is standard in these types of settlements.



You may be wondering why we’re bothering to talk about this, especially since we’re in such a new era. But remember when big players, like Coinbase’s <a href="https://blockworks.co/tag/brian-armstrong">Brian Armstrong</a>, said they wouldn’t hire or interact with firms that brought on ex-SEC enforcement lawyers? This is a similar situation.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">We&#39;ve let all the law firms we work with know, that if they hire anyone who committed these bad deeds in the (soon to be) prior administration, we will no longer be a client of theirs. Senior partners at these law firms seem unaware of the crypto industry&#39;s position on this.… <a href="https://t.co/k8R6NtfTV1">https://t.co/k8R6NtfTV1</a> <a href="https://t.co/RT0k408i9f">pic.twitter.com/RT0k408i9f</a>&mdash; Brian Armstrong (@brian_armstrong) <a href="https://twitter.com/brian_armstrong/status/1863774342267781222?ref_src=twsrc%5Etfw">December 3, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Yes, things look a lot brighter now, but that doesn’t change the past, and in order to move forward, it’s important to acknowledge what happened and get to the bottom of it. Think about Castle Island Ventures’ Nic Carter’s <a href="https://niccarter.info/">push</a> to prove <a href="https://www.coindesk.com/opinion/2024/12/06/proof-of-operation-chokepoint-2-0">Operation Chokepoint 2.0 happened</a>.&nbsp;



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CFTC

Gemini says it had ‘no choice’ but to settle with CFTC

<h2 class="wp-block-heading">The rise of on-chain private credit</h2>



Institutional investors are increasingly eyeing tokenized private credit as the next frontier in fixed-income. Even BlackRock’s CEO Larry Fink has proclaimed that “every asset… can be tokenized” and that this innovation could “revolutionize investing”​. Private credit – loans to businesses outside traditional bank lending – is at the forefront of this trend. As of early 2025, roughly $12.9 billion worth of private credit has been brought on-chain, making it the largest segment of the tokenized real-asset market (surpassing tokenized treasuries at ~$6.2B)​. Investors are drawn by the promise of efficiency and attractive yields: traditional private credit already yields ~8–12% to compensate for illiquidity​, and newer tokenized deals are often targeting 14%+ annual returns. In a world of tightening spreads, double-digit yields from real-world loans have become a compelling opportunity.



Total tokenized real-world asset value (USD)



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1110" height="666" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/06/Screenshot-2025-06-06-at-12.51.00 PM.png?w=1024&amp;h=1024" alt="" class="wp-image-103599" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/06/Screenshot-2025-06-06-at-12.51.00 PM.png?w=1110 1110w, https://blockworks-co.imgix.net/wp-content/uploads/2025/06/Screenshot-2025-06-06-at-12.51.00 PM.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/06/Screenshot-2025-06-06-at-12.51.00 PM.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/06/Screenshot-2025-06-06-at-12.51.00 PM.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/06/Screenshot-2025-06-06-at-12.51.00 PM.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2025/06/Screenshot-2025-06-06-at-12.51.00 PM.png?w=435 435w, https://blockworks-co.imgix.net/wp-content/uploads/2025/06/Screenshot-2025-06-06-at-12.51.00 PM.png?w=365 365w, https://blockworks-co.imgix.net/wp-content/uploads/2025/06/Screenshot-2025-06-06-at-12.51.00 PM.png?w=80 80w" sizes="auto, (max-width: 1110px) 100vw, 1110px" /><figcaption class="wp-element-caption">Total value of tokenized real-world assets on public blockchains, by category (USD). Private credit (blue area) leads the pack as of early 2025​.</figcaption></figure>



<ul class="wp-block-list">
<li><a href="https://debita.io/?utm_source=blockworks">Debita</a> is an on-chain private-credit platform engineered by market-finance experts, delivering alternative financing rails to businesses in emerging economies and aimed at bridging the financing gap for those excluded from capital markets.</li>



<li>US $80 million already placed, inaugural deals yielding 14–20 %, and a pipeline poisedto issue more than US $150 million over the next 12 months. Debita&#8217;s ecosystem includes commercial banks, investment banks, structuring agents and servicers in markets such as Mexico, the Dominican Republic, Panama, Colombia and Argentina. In addition to multilateral and development banks, international credit funds and family offices.</li>
</ul>



“Blockchain has reached the point where it can carry real-world assets with bank-grade controls. By digitising loans or bonds on-chain we settle cash and securities in seconds, 24/7, and even carve them into fractional interests that can trade compliantly. That opens markets once off-limits to a far broader pool of professional capital. We’re standing at the threshold of a US $2 trillion private-credit market that is about to gain liquidity, transparency and fresh funding. In short, this isn’t just back-office efficiency—it’s new yield and true diversification for investors.”



— Julio Ferrón, CEO at <a href="https://neitec.io/?utm_source=blockworks">Neitec</a>



<h2 class="wp-block-heading">The $5 trillion SME funding gap</h2>



Behind the excitement over yields lies a deeper issue: a systemic funding gap for small and medium-sized enterprises (SMEs) in emerging markets. These companies are the engines of job creation and GDP growth, yet they remain chronically underfinanced. According to the International Finance Corporation, the global **SME credit gap is about $5.7 trillion, and it swells to over $8 trillion if you include informal businesses​. In emerging economies, local banks often consider SME loans too risky or costly to underwrite, citing lack of collateral, high due diligence costs, and limited credit data. This leaves millions of viable businesses without affordable credit. The result is a classic market failure.&nbsp;



On one side, small and medium-sized enterprises (SMEs) in developing countries struggle to obtain loans to expand factories, hire workers, or purchase inventory. On the other side, investors worldwide are chasing higher yields but face structural barriers that prevent them from channeling funds to these businesses. This persistent financing gap—between microcredit at one end and large-scale corporate finance at the other—has endured for decades. Bridging this financing gap isn’t just a development goal; it represents an enormous untapped market.&nbsp;



In this sense, our mission is to channel financing that helps businesses grow, strengthens local economies, boosts domestic value creation, and improves people’s lives, because that is what matters: doing our part to advance humanity’s progress.



<h2 class="wp-block-heading">Bridging the divide: Neitec and Debita</h2>



This is why Neitec team, uk- basedfintech founded by a team coming from Barclays, Santander or KPMG, among others, built Debita. Debita offers an integrated platform that unifies the origination, structuring, servicing and placement of private debt for mid-sized companies and fintechs in Latin America—markets where access to capital is scarce and local banks cannot meet demand. By bringing risk assessment, compliance controls, data-room management, servicing and syndication processes together in one environment, we tangibly streamline workflows that were previously scattered across multiple actors.&nbsp;



Thanks to this standardization, issuers can structure their deals efficiently and reach global investors at a lower operating cost.&nbsp;



<h3 class="wp-block-heading">Why stablecoins for B2B crossborder transactions?</h3>



The platform selectively incorporates on-chain rails, collapsing both time and cost in the payment and settlement of private debt. By moving the cash leg and the asset leg onto the same block, we eliminate the usual correspondent-bank waiting period and reduce fees for transfers and FX conversions, allowing transactions to settle in seconds rather than days.This speed not only cuts costs; it also translates into greater working-capital headroom for issuers, as funds freed from traditional banking procedures can be deployed immediately into inventory, payroll, or new projects—reinforcing the growth capacity of SMEs in emerging markets.&nbsp;



<h3 class="wp-block-heading">Extend credit without balance-sheet strain: how banks partner with Debita</h3>



Debita sources transactions through different channels: local structuring boutiques that originate and shepherd deals on the ground; commercial/investment banks that originate new loans and syndicate the risk through the platform instead of keeping it on their own balance sheet; and issuers that come directly to the platform.



Also, this approach allows them to offer new yield-bearing products to private-banking clients—fully managed via the platform—while maintaining visibility over each transaction. By distributing placements beyond local markets, Debita broadens the investor base, enhances risk diversification. Such capabilities are particularly valuable in jurisdictions with evolving financial infrastructures or stricter frameworks, where access to international funding and effective risk-sharing can be crucial to growth.&nbsp;



The result is an ecosystem that provides corporates and fintechs with a more reliable and transparent funding path, spurring productive investment in regions with limited access to capital. By connecting the supply and demand of credit in a single digital flow—including the participation of financial institutions seeking to syndicate or structure transactions—Debita lays the foundations for faster, more global access to capital with the potential for real, sustainable impact on local economies.



<h2 class="wp-block-heading">Why is this a great opportunity for institutional investors?</h2>



Global institutional investors access mid- to high-double-digit yield private credit deals—vetted by local partners and rating agencies—managed within a single platform that delivers real-time, transparent oversight and all the cost and settlement efficiencies of on-chain asset representation. In short, Debita turns fragmented, high-friction emerging-market lending into a single, transparent feed of diversified, high-yield private credit ready for institutional balance sheets.



<h2 class="wp-block-heading">Key Takeaways</h2>



Debita is effectively building the infrastructure for a more inclusive financial system. It takes the best of both worlds: the credibility and rigor of traditional finance, and the efficiency and openness of new technology. This alignment positions Debita. We are seeing large asset managers and banks increasingly experiment in this space, from tokenized funds to blockchain-settled bond issues. Their goal is not just to cut costs, but to expand their investment universe safely.&nbsp;



Imagine billions of dollars flowing from pension funds and sovereign investors in North America, Europe, and the Middle East directly to mid-sized businesses in emerging countries. That kind of capital mobilization could fuel a new era of growth in those economies .



In summary, Neitec’s Debita platform is closing the credit gap by unlocking high-yield private debt in markets that need it most. It demonstrates that tokenization is not just about improving efficiency in mature markets; it’s about innovating for inclusion, bringing new borrowers and lenders together in ways not previously possible.



<h2 class="wp-block-heading">Ready to explore on-chain private credit?</h2>



Request our investor deck or book a 30-minute call with Neitec’s team:



<ul class="wp-block-list">
<li>📧 enquiries@neitec.io</li>



<li>📅 <a href="https://calendly.com/pdelasmatas-neitec/new-meeting?month=2025-06">Schedule a call</a></li>
</ul>



This content is sponsored and does not serve as an endorsement by Blockworks. The veracity of this content has not been verified and should not serve as financial advice. We encourage readers to conduct their own research before making financial decisions.



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Borderless private credit: How Neitec is bridging a $5T credit gap through Debita

Byron Gilliam

This is a segment from The Breakdown newsletter. To read full editions, <a href="https://blockworks.co/brand/the-breakdown">subscribe</a>.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
“The money supply is the blood of the economic body; when it flows freely, the economy prospers.”&nbsp;



— Irving Fisher
</blockquote>



In New York City, paying by check first became commonplace in the booming economy of the 1840s.&nbsp;



This was a major financial innovation: Instead of walking out of the bank with a satchel of borrowed cash to pay for, say, a steamer full of Southern cotton at the docks, a merchant could have a loan credited to a checking account and then settle his purchases with a few strokes of the pen.



As banking expanded and commerce sped up, checks offered a safer, faster way to move money through the city.



But the money did still have to be physically moved around.



Unlike today, banks did not unquestionably accept each other’s bank notes at face value.



Instead, payments between banks were settled in “specie” (gold coins, usually), which had to be shuttled back and forth across the city according to who had paid whom.



To do so, each bank employed a porter whose job it was to settle the transactions the bank’s depositors had made with checks.&nbsp;



Every day, the city’s 50 or so bank porters would set out with a ledger book, checks their bank had received and bags of gold coins.



Their job was to visit the city’s 49 other banks, present their checks for payment and collect any checks drawn on their own bank.



If the value of the checks they presented was greater than what they had received, they collected the difference in gold — or paid it out of their bag if the balance went the other way.



This system worked well enough when there were only a handful of banks in the city, but by 1850 there were too many of them for porters to both travel to and settle accounts within a single day.



So New York’s banks agreed to continue exchanging checks daily but to settle accounts in specie only once a week.



Friday mornings, the porters would gather on Wall Street (outdoors) to exchange gold coins and close the books on the week.



As a <a href="https://www.survivorlibrary.com/library/a_century_of_banking_in_new_york_1922.pdf?utm_source=chatgpt.com">history of New York banking</a> later explained with an illustrative example, however, this was no easy task:



“Thomas had left a bag of specie at John&#8217;s bank to settle a balance, which was due from William&#8217;s Bank to Robert&#8217;s; but Robert&#8217;s bank owed twice as much to John&#8217;s. What had become of that? Then Alexander owed Robert also, and William was indebted to Alexander. Peter then said that he had paid Robert by a draft from James, which he, James, had received from Alfred on Alexander&#8217;s account. That, however, had settled only half the debt. A quarter of the remainder was cancelled by a bag of coin, which Samuel had handed over to Joseph, and he had transferred to David.”&nbsp;



“It is entirely safe to say that the Presidents and Cashiers of the banks themselves could not have untangled this medley,” the author concluded.



But not for long: The untangling of said medley was the next great innovation in moving money around.



In 1853, the New York Clearing House was established, after which banks settled their accounts “multilaterally” — each bank settling with the Clearing House instead of with each other.



This is a much better way to do business: fewer messengers, fewer mistakes and far less gold to lug around (and get lost or stolen).&nbsp;



“In one case,” the banking historian noted, “a bank which had debit charges footing up $6,180,000 had to pay merely $167.31.”



At first, that remaining balance would still be settled in specie, so the city’s porters stayed busy.&nbsp;



But this soon changed as banks began leaving their gold on deposit with the Clearing House in return for “specie certificates” — paper receipts backed by gold, which could be used to settle debts without moving the metal itself (an early form of ETF, basically).



This was more than just a way to make life easier for banks, however.&nbsp;



Each innovation in payments — from checks to clearing houses to specie certificates — helped money move faster through the system, accelerating commerce for everyone.



That’s important because when money flows freely, economies prosper — the faster banks settle, the faster they can start lending again.



Checks were faster than cash, clearinghouses were faster than porters and specie certificates were faster than gold coins — and each made the economy run faster, too.&nbsp;



Money has since gotten even faster, of course. Today, innovations like Fedwire and CHIPS move trillions of dollars a day with no gold coins, no bank porters and barely any delay.



But as fast as money moves now, there’s no reason to think it can’t move faster — the history of banking suggests there’s always a better way.



Increasingly, people think that way might be stablecoins. CHIPS and Fedwire allow near-instant settlement, but only within a narrow circle of regulated financial institutions and only during regular US business hours.



Stablecoins have the potential to remove these frictions.



Anyone can move digital dollars — globally, 24/7 and permissionlessly — without waiting for a bank to approve the transaction, a clearinghouse to open or a central bank to update its spreadsheets.



In the US, digital dollars have so far been used mostly to facilitate the 24/7 market in crypto trading, which, on its own, isn’t much of a breakthrough.



But <a href="https://www.wsj.com/finance/banking/walmart-amazon-stablecoin-07de2fdd?st=gUAuRr">news</a> that Walmart and Amazon are both considering issuing store-branded stablecoins hints at something much bigger.



If stablecoins were to gain traction in everyday commerce, it might represent the next evolutionary step in payments: a dollar that not only moves faster than ever before, but moves more often, in more places, by more people.



We’d all stand to benefit — because when money moves faster, everything else does too.



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The Breakdown Newsletter

Are stablecoins the next great acceleration of money?

Jeff Albus

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Solana&#8217;s memecoin season mostly played out on <a href="https://blockworks.co/tag/dexs">DEXs</a> like Raydium and Jupiter, with centralized exchanges, which sometimes only get around to listing new tokens after their popularity has peaked, sitting the party out.



Hard to blame them at the time. Liquidity was scattered, tokens were often unserious and (in earlier political climates) listings seemed sure to attract unwanted scrutiny from the big-bads at the SEC.



But the world has changed, there&#8217;s money to be made, and strategies are now in flux.



Last week, centralized exchange Bybit <a href="https://x.com/byreal_io/status/1934085435212308789">announced</a> a new Solana-based exchange called Byreal. According to the company, it&#8217;s being built from scratch and incubated in-house. Today, the project&#8217;s socials went live with the announcement of a testnet, set for June 30, and a mainnet slated for Q3 this year.



According to the announcement, Byreal will offer a &#8220;hybrid&#8221; model meant to merge centralized liquidity with decentralized execution.&nbsp;



Pitched as an extension of Bybit itself, it will route trades using Request for Quote (RFQ) and Concentrated Liquidity (CLMM) mechanisms, integrate MEV protection and leverage unified liquidity sources. Users get execution from market makers or LPs, depending on the asset and conditions.



There&#8217;s also Revive Vault, a curated yield product designed to deliver real yield on Solana assets like bbSOL, and its own token launchpad, called Reset Launch.



The latter seeks to create a more equitable token distribution by combining a Smart Price Ladder that raises token prices incrementally with a Fairshare Engine that distributes allocations based on participation rather than speed.



And that&#8217;s all well and good, but in a world already full to bursting with competing DEXs, why does Bybit think Solana needs another one?



Well, despite DeFi&#8217;s promise of open, onchain finance, most trading still happens on centralized exchanges. That&#8217;s partly due to liquidity fragmentation, partly due to painful UX, and mostly because DEXs still can&#8217;t compete with CEXs on slippage, speed or price execution.



With its fast finality and low fees, Solana is uniquely positioned to bridge that gap. But its most popular DEXs tend to specialize: Phoenix offers pure order books, Jupiter routes swaps and Raydium hosts memecoin liquidity.



Then there’s the <a href="https://blockworks.co/news/hyperliquid-hype-valued-l1-perps-dex">growing trading juggernaut</a> in Hyperliquid — which uses colocated validators to hit CEX-like performance in a no-KYC DEX environment. It’s obviously a different blockchain with some centralization tradeoffs, but Solana, DEXs, and CEXs could all have a lot to lose if Hyperliquid becomes the retail crypto trading platform of choice.



The Solana market-proper lacks a DEX that combines deep liquidity, fair price discovery and streamlined onboarding into a single package, though.



So that&#8217;s the play for Byreal: balance CEX-grade execution, DeFi transparency and user experience while unifying liquidity into a single trading venue. If it can ship fast and attract real projects, Bybit probably won&#8217;t be the only CEX to script a second act beyond CeFi.



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Bybit

Solana gets new hybrid DEX from Bybit

Ben Strack

This is a segment from the Forward Guidance newsletter. To read full editions, <a href="https://blockworks.co/newsletter/forwardguidance" target="_blank" rel="noreferrer noopener">subscribe</a>.



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I enjoyed my time off, but it’s always nice to be back in the loop.



A lot happened on the crypto ETF front while I was away. And perhaps you forgot we’re approaching a very important SEC deadline. But first, checking up on ETF filings — as one does first thing after returning from abroad — I came across Yorkville America Digital’s latest proposal. That would be a Truth Social-branded ETF that this time would hold both BTC and ETH.&nbsp;&nbsp;



Yorkville finalized a <a href="https://link.mail.beehiiv.com/ss/c/u001.ZaVO_gulYIDHwTR9OqetU7Bg8sIaNC2rP34QpXDcW9bROa8OG6u8KUk2Ksj30caIO8AshtUnCCj3JUrnZ9ZnCWV7CvGHxy2bb7uPaVtNfMXc6gMcc8RJw2xgWCOf2bltlDITjHKNajWiaKqEvaqpaUaX8He4h4dqq_IResmS6zJa6F7of0_OsuxdefaxYCDTuNUxevPZB6__p5TvYqQ2g8uOGjxB-L5VxsB4QjfbNeCBbQkG7BZKIDfxgW8uFTMXdkS9h9_7lCT61QPi9U-SGA313Qdrfh2rBYszvJAf2r7Q4-LO2H-IqwpFGDao_B3l1-7B84fIZNTyerPJw6GbeN2GO6z3Rdf-MxGt1VeQWKWtAm0I3zddceOO0KXRj-waO1J5GzQjkDqrkY0fJGIxIw/4h2/W281edT0Tvy2ifMnqMRofw/h10/h001.W5z2fT0ooCNchgCsfv4KC5tlh2Ygj72dV8wIcM-wrHQ">partnership</a> with Truth Social parent company Trump Media and Technology Group in April and previously signaled its plan to launch a bitcoin ETF.



CoinShares, meanwhile, joined the spot solana ETF race, becoming the eighth issuer to do so. The firm declined to comment.&nbsp;



Those filings come after the <a href="https://blockworks.co/news/solana-etf-sec-forms">SEC engaged with issuers</a> about spot SOL products and the subsequent S-1 amendments. You likely saw that covered in Blockworks last week.&nbsp;



A person familiar with the amendments told me today that the exact timeline of an SEC ruling on the solana products remains unknown. But “a flurry of filings” is typically “the best sign” that products are close to approval, the source noted, adding the latest S-1s point to “some sort of push from the SEC to get things organized.”



While those proposal adjustments dealt with the single-asset funds (complete with staking language), let us not forget about crypto index ETFs.



We should know by July 2 whether the SEC is letting the Grayscale Digital Large Cap Fund (GDLC) convert to an ETF. That fund’s holdings are below: <img loading="lazy" decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcaun9C2KV1UUFZEXv4cG6fs3L8u9ppVUPmFWjK0sOqKa8Ac0WHg5f2X6PmbLc82sqPXjljtzY1XjF_Be49KszGMlGAEAriAksWqcGiBS7TMZDEfVcoxFa-SmgSPniNJpMCEbuKbA?key=GRK8bxE7P9eK5pHWpv-e5Q" width="624" height="291"> 



Bloomberg Intelligence analysts expect the agency to let GDLC — and the Bitwise 10 Crypto Index Fund (BITW) — become ETFs.&nbsp;&nbsp;



“Having only small allocations to alternative coins might help their ETF conversion bids even if the SEC hasn’t individually approved each asset for an ETF wrapper,” James Seyffart and Eric Balchunas wrote in a note last week.



Samir Kerbage, CIO of Brazil-based asset manager Hashdex, shared a similar sentiment when we <a href="https://blockworks.co/news/hashdex-crypto-etfs-index-sec-interview">spoke last month</a>. The company filed to allow its existing Nasdaq Crypto Index US ETF (NCIQ) to hold tokens beyond BTC and ETH — like SOL, XRP and others.&nbsp;&nbsp;



Kerbage told me today that he views the solana ETF S-1 amendments as “a positive development toward approving broader crypto index ETF proposals — as BTC, ETH and SOL, combined, constitute more than 90% of the Nasdaq Crypto Index.”



To be clear, the person familiar with the latest ETF filings views the S-1 amendments and upcoming crypto index product deadline as two distinct things.



Still, some think the SEC greenlighting crypto index ETFs could open the floodgates. Take this June 10 X post by Van Buren Capital general partner Scott Johnsson, for example, which appears to allude to the July 2 deadline.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Should be about 3 weeks away from the SEC laying out the playing field for crypto ETFs for the next several years. Expecting the universe of allowable strategies to begin expanding meaningfully.&mdash; Scott Johnsson (@SGJohnsson) <a href="https://twitter.com/SGJohnsson/status/1932433474872565797?ref_src=twsrc%5Etfw">June 10, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



He <a href="https://x.com/SGJohnsson/status/1915619368156762388?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1915619368156762388%7Ctwgr%5E00d4fbd43a5d291f9b959e2f9ff743febce506e2%7Ctwcon%5Es1_&amp;ref_url=https%3A%2F%2Fblockworks.co%2Fnews%2Fhashdex-crypto-etfs-index-sec-interview">noted</a> last month that because the index products have a more undefined universe of allocations, the SEC would theoretically adopt a general rule vs. a case-by-case rule application.



“Once the index products are (hopefully) cleared, it should be a simple application of the general rule to the single asset spot products,” Johnsson added at the time.&nbsp;



We’ll be watching this very closely over the next two weeks.



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ETFs

Crypto ETF filings multiply ahead of SEC index fund decision

This is a segment from The Drop newsletter. To read full editions, <a href="https://blockworks.co/newsletter/thedrop" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Now that the US regulatory climate around crypto has shifted, some, like a16z’s Miles Jennings, have declared that crypto foundations like those set up in the Cayman Islands are no longer necessary and should be a thing of the past.



Jennings, who is the venture firm’s head of policy and general counsel, <a href="https://a16zcrypto.com/posts/article/end-foundation-era-crypto/">wrote</a> in a recent blog post that foundations became standard initially to increase decentralization. But over time, he argues, foundations’ lack of economic incentives, combined with existing legal and economic constraints, have made it difficult for the nonprofits to be productive or broadly financially successful.



“Most foundation setups require projects to spend upwards of $500,000 and several months working with an army of lawyers and accountants. This not only slows innovation, it’s cost prohibitive for small startups,” Jennings said.&nbsp;



“The situation has gotten so bad that it’s now increasingly difficult to even find attorneys with experience setting up foreign foundation structures, because many have given up their practices. Why? Because they now just collect fees as professional board members on dozens of crypto foundations,” he argued.



Jennings concluded that companies are just better. Foundations have turned into controlling entities, but could evolve into other formats like Decentralized Unincorporated Nonprofit Associations (DUNAs), while developer firms could become Public Benefit Corporations (PBCs).&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I&#39;ve never been more optimistic about the chances of market structure legislation passing in the U.S. It&#39;s a great time to be building in crypto in America. <a href="https://t.co/ZO8HjVrErS">https://t.co/ZO8HjVrErS</a>&mdash; miles jennings (@milesjennings) <a href="https://twitter.com/milesjennings/status/1932883189443539059?ref_src=twsrc%5Etfw">June 11, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



How do other blockchain attorneys feel about crypto foundations, especially when they have historically been set up to address regulatory and taxation concerns?&nbsp;



&#8220;Foundations for token issuances are neither needed nor would they be particularly effective in instances where there was a concern whether or not the token constitutes a security,” David Otto, managing partner at Martin Davis PLLC who led defense in the <a href="https://www.sec.gov/files/litigation/litreleases/2025/stip26299.pdf">recently-dismissed</a> SEC lawsuit against DragonChain, told me in a message.



“There generally is no longer the perception that one needs to create a foundation (other than for specific jurisdictions that provide for tax benefits) in connection with a token issuance,” Otto added.



Moish Peltz, co-managing partner of Falcon, Rappaport &amp; Berkman&#8217;s <a href="https://frblaw.com/practices/digital-assets/">Digital Assets Group</a>, said that offshore foundations can still have a role in crypto, but “rationale is narrowing as US rules catch up.”



Peltz suggested that US teams should look into starting US-based UNAs or DUNAs instead — or set up an LLC as a for-profit option.&nbsp;



He advises to “only look offshore if (a) a significant share of contributors cannot participate under U.S. securities or tax laws, or (b) the project’s community is already truly global and wants a neutral flag. Even then, they should expect to satisfy disclosure, KYC, and board-independence standards they would face here.”



“The real barrier is the tax,” Peltz continued. “Token treasuries often appreciate before they are spent. If the IRS provides clearer deferral or charitable-like treatment for bona-fide decentralized or public-goods projects, many of the remaining reasons to go offshore will compress.”



Tyler Harttraft, a partner at Bull Blockchain Law, told me that crypto foundations remain essential for US teams launching tokens. He noted that the tax breaks are the main reason crypto has been drawn to Cayman Islands foundations in the past, and this will likely remain the preferred pathway until new US regulation is solidified.



“The current US regulatory landscape offers no clear issuance pathway: Although the SEC is exploring exemptive relief and Congress has proposed measures like the Clarity Act and the Digital Asset Market Structure draft, none have yet created a formal safe-harbor for new token launches. As a result, advising a crypto firm to establish a separate non-US foundation remains the only reliable option for legal and tax certainty,” Harttraft said.



Video streaming- and data storage-focused network Livepeer is one example of a crypto ecosystem that just launched a foundation earlier this month in the current climate.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Today is a big day in the <a href="https://twitter.com/Livepeer?ref_src=twsrc%5Etfw">@Livepeer</a> ecosystem, as we share the launch of the new Livepeer Foundation! 8 years ago, at the dawn of the project, we opted not to take the Foundation path, for many of the reasons that <a href="https://twitter.com/milesjennings?ref_src=twsrc%5Etfw">@milesjennings</a> from A16Z Crypto recently articulated in a… <a href="https://t.co/a99WApcJP3">https://t.co/a99WApcJP3</a>&mdash; Doug Petkanics (@petkanics) <a href="https://twitter.com/petkanics/status/1930642003156435232?ref_src=twsrc%5Etfw">June 5, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



“We’re creating something leaner, more focused, and better suited to the actual needs of a mature, multi-entity, decentralized network,” Livepeer cofounder and CEO Doug Petkanics told me in a message. “Many foundations have become bloated intermediaries that exist as a regulatory workaround, and neither accelerate decentralization nor improve execution.”



The current political climate suggests foundations may not be needed for much longer, which would be a drastic change from the status quo of the past decade.&nbsp;



While some foundations serve more of a purpose than others, setting up something leaner or doing away with the model entirely would increase competition and aid scrappy startup builders in the US looking to bring tokenization to their consumer apps. Progress!



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<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

International

Do crypto teams still need offshore foundations?

Donovan Choy

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/0xresearch" target="_blank" rel="noreferrer noopener">subscribe</a>.



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World War II’s outcome was fundamentally determined by access to oil.



So depleted was the resource by the final stages of the war that Nazi Germany resorted to extraordinary measures to maintain basic mobility — pulling trucks by oxen, four at a time.



The oil situation for the armies of Imperial Japan was equally dire. In Daniel Yergin’s Pulitzer Prize-winning book The Prize, he documented how the Japanese kamikaze suicide pilots would fill their tanks to only halfway since they were not meant to return from their missions.



The armies of both Nazi Germany and Imperial Japan were defeated not for lack of manpower or armaments, but because they ran out of oil.



Oil’s enduring legacy in the history of the deadliest conflict in human history continues to influence and reverberate throughout contemporary thinking.



For instance, “<a href="https://truthonthemarket.com/2019/10/08/why-data-is-not-the-new-oil/">data is the new oil</a>” is the rally cry of Big Tech critics when they clamor for stronger regulations of tech companies.&nbsp;



Whether they do it unknowingly or not, the metaphor draws a parallel between oil’s historical importance and the emerging value of data in the digital economy.



That analogy too has permeated crypto, evident in our use of words like “gas” and “burn.”



Channeling that meme to the fullest is last week’s “The Bull Case For ETH” report co-authored by top Ethereum stakeholders.



In the report, ETH is projected at a value of $8k per ETH ($1 trillion market cap) in the short term.



The long-term moon math goes even further: ETH at a $85 trillion asset of $706k per ETH — a steal at today’s prices!



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcHACO2f_Raldni6zd72h5ZTPMm8xUJwkGkixyDxfyP9lDXVTpSYWc13ZpJO96z-rsKsA8CPsuSWOaqDcLlMj9EqUxC3s7MbwmKFJ8GMgyXLz_X5IsU1lre_I3LtaBDheSsJ-1wAw?key=7beOlZh4fLlxRGum6-OPxA" alt=""/></figure>



Source: <a href="https://ethdigitaloil.com/">Ethdigitaloil</a>



Part of this valuation model benchmarks ETH against today’s $85 trillion oil market valuation.



But the case for ETH as “digital oil” is more complex than that.



For one, unlike real armies, the heaviest gas guzzlers of ETH have cheaper alternatives.



Ethereum’s largest <a href="https://etherscan.io/gastracker">gas guzzlers</a> have historically been Uniswap and Tether. Both are actively moving their execution onto more gas-optimized environments (Unichain and Plasma).



Though Plasma isn’t live yet, and Unichain is still in its early days, it does considerably weaken the case for ETH as “digital oil.”



What about data availability?



The biggest ETH-denominated bill for L2s is the cost of using Ethereum DA, namely publishing your raw transaction data to the L1.&nbsp;



Before the introduction of blob space with EIP-4844, 1 kB of call data would cost about 16,000 gas, or about $1.44 (assuming ETH at $3000).



That’s a non-trivial 80-90% of a typical L2 fee.



EIP-4844 brought legacy call data costs down by ~99%, yet it is still cheaper by ~20-30x if rollups use an alternative-DA layer like Celestia or EigenDA.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXc_leEK2S_w7cCv3UrbbgcTiDJmo1dUmcydr-icsFXuCTvSdrY4X9SXO3AQtXI_I8cqee6IYDcSzKJVTX1L5Fp1zCoFdQ9RKr_eVg_k_zpeDnxGwfRGq4_BOQzgOUS2A3tPhotq?key=7beOlZh4fLlxRGum6-OPxA" alt=""/></figure>



The ETH as “digital oil” thesis crumbles further when you consider that Ethereum itself faces stiff competition from competing L1s.



If Ethereum can claim its native asset as “digital oil,” so can Solana, Sui and every other ecosystem.



Yes, Ethereum is the largest crypto economy and the second largest crypto asset. But the Ethereum economy is not so far ahead of its peers that ETH would have the same overwhelming influence that oil does.



The whole analogy of ETH as “digital oil” rests on shaky premises.



ETH may very well be a global reserve asset, but memeing that into existence would be tough for institutional investors to swallow.



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<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



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<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

ETH as digital oil is a tough sell

David Canellis

This is a segment from the Supply Shock newsletter. To read full editions, <a href="https://blockworks.co/newsletter/supplyshock" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Last week, we <a href="https://blockworks.co/news/bitcoin-faucet">covered a story</a> that might’ve made you feel impossibly late to Bitcoin.



Let’s undo that feeling.&nbsp;



I’m not here to make the case that nation states and multibillion-dollar companies buying bitcoin is not a big deal.



El Salvador adopting BTC as legal tender will go down in history as one of the most significant events in finance, modern or otherwise, regardless of how it ended. Bhutan’s harnessing of its bountiful hydropower capacity to <a href="https://blockworks.co/news/bhutan-btc-mining-operations">mine bitcoin</a> is equally momentous.&nbsp;



So is Michael Saylor and (Micro)Strategy’s toppling of the first corporate domino, when it bought $250 million bitcoin in 2020. Square (now Block) and Tesla quickly followed, then a few firms across Asia, and then a few more in the US. Now, companies are announcing <a href="https://blockworks.co/news/crypto-treasury-companies-alt-season">new treasury strategies</a> every other day.



Almost half a decade later, one portal <a href="https://bitbo.io/treasuries/">counts</a> 74 public stocks with at least some bitcoin on their balance sheets, totaling 764,070 BTC ($86.1 billion), or almost 4% of the circulating supply. (Strategy makes up over three quarters of the whole.)



And then there’s the two-and-a-half dozen ETFs and other funds with 1.39 million BTC ($148.7 billion), or over 6.6% of the coins in existence, most of it belonging to BlackRock, Fidelity and Grayscale.&nbsp;



Obviously, the price of bitcoin has jumped alongside each leap of adoption in the past five years: major corporations, sovereigns, asset managers and then back to corporations of all sizes, including SPACs.



Bitcoin is up almost 10x since Strategy’s first buy, 3x since Nayib Bukele announced the Bitcoin Law, and nearly 2.5x since the SEC approved ETFs for trading.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfOiN6nQrDvOI1Ii7Numjb7G17I49pICdmwOuxOTcLjY44cCdVjoEModDz82cOlu6AKyLBvYAYq7nWSAvi1ETAc7fHbXLoZF9cfmxbxG7E4YGhPVqPWxGufPchsiqdvJvZGney1Qw?key=bpLdakvHr3aDuf5I1h5bXg" alt=""/><figcaption class="wp-element-caption">MetaPlanet has only 1.5% of Strategy&#8217;s stash, but the impact is still clear.</figcaption></figure>



At this point, and however unintuitive, the supply of bitcoin could be more decentralized than it has ever been, even if more of it is owned by centralized entities than ever before.



Wasn’t this meant to make you feel early to Bitcoin?&nbsp;



There are plenty of reasons to be confident about the price of bitcoin. I’ll leave it to others to amplify them, but if your yardstick for “earliness” is based on your entry point to BTC, then I’m afraid it’s all relative. You’re always earlier than some but later than others.



Here’s an alternative view: We’re all early to Bitcoin until the novelty wears off.



First, it was crime. The media loved crypto crime stories — because these soaked up traffic. But on a long enough timeline, all crime <a href="https://blockworks.co/news/crypto-fraud-financial-scam">will be “crypto crime</a>,” and related headlines have been passé for years already.



News of corporate bitcoin treasuries is destined to go the same way. As will word of sovereign funds, governments, <a href="https://x.com/cardano_5pc/status/1932445329074655563">altcoins</a> and pensions buying bitcoin. Maybe religious institutions will come next, or Ivy League universities. Record labels and movie studios, public and private. Elementary schools and mom and pops.



As Bitcoin eats the world, each wave of adoption will feel like a novelty, until it isn’t. Only then will I happily agree that we’re no longer early.



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<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



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<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
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Bitcoin

You’ll know Bitcoin has won when it’s suddenly boring

This is a segment from the Empire newsletter. To read full editions, <a href="https://blockworks.co/newsletter/empire" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Could we get an alt season after all?



Monarq Asset Management’s Shiliang Tang told <a href="https://blockworks.co/podcast/empire">Empire co-host Jason Yanowitz</a> that there’s a possibility that the popularity of crypto treasury companies sparks an alt season that we haven’t seen before. This one would be focused on tokens deemed “ fundamentally valuable enough for traditional public money and capital” to get involved with.



It’s an interesting take, and one that I haven’t heard before. Especially because there’s a lot of criticism around these vehicles, some of which is warranted due to the entities’ structure.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">In this morning&#39;s spaces that we had I was banging the drum about how I was concerned that these treasury acquisition vehicle companies were fleecing equity holders by being higher up the capital structure and using retail as exit liquidity to dilute and sell into. Here we are. <a href="https://t.co/X0pgBx1FoO">https://t.co/X0pgBx1FoO</a>&mdash; fejau (@fejau_inc) <a href="https://twitter.com/fejau_inc/status/1933274896924356750?ref_src=twsrc%5Etfw">June 12, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Meanwhile, FalconX’s Josh Lim said that the rise of these treasury companies puts crypto — if we’re recycling what we talked about on Friday — in the “early to mid” innings of crypto’s adoption.&nbsp;



 ”There&#8217;s a pretty healthy pipeline of large deals. Like, we think there&#8217;s only going to be a handful of really credible teams like operators and the bankers [and investors]” that participate in these deals, he said.&nbsp;



<figure class="wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio"><div class="wp-block-embed__wrapper">
<iframe loading="lazy" title="The State Of Crypto Derivatives" width="1024" height="576" src="https://www.youtube.com/embed/YzMlgm3o_rM?feature=oembed" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>
</div></figure>



He noted that there’s generally a “chosen one” in each category, and those are the winners. Take, for example, <a href="https://blockworks.co/tag/microstrategy">Strategy</a> or perhaps SharpLink Gaming. Strategy’s pretty much set itself as the gold standard, and SharpLink <a href="https://blockworks.co/news/bitcoin-treasury-strategies-sharplink-eth">could apply</a> the Strategy playbook to ETH.



Lim noted that he thinks there’ll be four or five “big ones” and then “lots of small ones.” His exact estimate was 50 or so.&nbsp;



But while there’s an appetite now, Lim noted that there are still risks.&nbsp;



 ”The downside risks are basically there could be sort of…fatigue for these like public equity deals and crypto — let&#8217;s say flat lines — and all these things trade at a small discount to NAV,” he noted.&nbsp;



If the risks play out, then Lim says that the market needs to stabilize and wait for “more capital to come in.” He added that there’s precedent for it.&nbsp;



But Yanowitz thinks there’s a different risk on the horizon. He believes that these companies need a good financial engineer and a marketer. And for him, a lot of the smaller ones making the pivot don’t have either.



Look, it’s clear that the treasury companies are here to stay. But the battles for the best is still underway.&nbsp;



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<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
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altcoins

Can the rise in crypto treasury companies spark an alt season?

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Volatility is back. After rallying to $167 on June 11, SOL <a href="https://blockworks.co/price/sol">reversed</a> sharply below $145 as geopolitical shocks rattled risk markets. Israeli airstrikes on Iran and the ensuing global rush to hard assets <a href="https://x.com/3orovik/status/1849954887469089125">appear to be the trigger</a> here.



Oil surged. Gold <a href="https://www.theguardian.com/business/2025/jun/13/oil-and-gold-prices-soar-after-israel-attacks-on-iran">climbed</a>. Solana and Bitcoin stumbled off a cliff.



Early Friday, we saw BTC <a href="https://blockworks.co/price/btc">dip briefly below $103k</a>, triggering over $400 million in long liquidations before rebounding to ~$105k. Solana dropped around 9.6% with $52 million in liquidations, third only to BTC and ETH.



Despite the correction, Solana&#8217;s <a href="https://app.blockworksresearch.com/analytics/solana">core metrics have held</a>. Daily transaction counts remain around 80 million. Compute throughput is stable. Application revenue is steady at $4-7 million/day.



Solana&#8217;s DEX layer is rotating, with volume down to $2.5-3.5 billion, from over $6 billion in May. Pump.fun continues to dominate meme traffic while SolFi captures SOL-USD pairs. Meta-aggregators like Titan and Kamino Swap are <a href="https://app.blockworksresearch.com/research/solana-meta-aggregators">quietly gaining ground</a>, offering better routing via off-chain sources like Pyth&#8217;s Express Relay, and even as volumes dipped, execution efficiency improved.&nbsp;



Underneath the rabble, <a href="https://app.blockworksresearch.com/analytics/solana?dashboard=131">Solana&#8217;s staking layer is unshaken</a>. The stake rate holds at 65.4%, with net activations still outpacing deactivations. Liquid staking tokens, led by jitoSOL, remain steady near $7 billion. MEV tips from Jito declined post-frenzy, but validator income remains resilient. In other words, no real crisis of confidence is to be seen among active users.



It&#8217;s easy to see why some might worry superficially, what with SOL currently testing $140 support. A breakdown could open moves to $123 or even $110. But if BTC holds above $100k and oil premiums fade, SOL seems likely to stage a recovery.



Like it or not, the technical binary of reclaiming momentum vs. a deeper correction likely hinges a lot on bitcoin’s next move.



It&#8217;s a tough one to predict, given that the macro environment remains so unstable. Fed policy is tight, energy volatility is high, and crypto is once again correlated to equities and oil. That said, the US regulatory backdrop continues to shift positively.



President Trump&#8217;s <a href="https://blockworks.co/news/donald-trump-digital-asset-summit-address">public embrace</a> of dollar-backed stablecoins and federal frameworks adds a long-term bullish undertone, for instance — especially for chains like Solana that anchor stablecoin infrastructure.



The bottom line is, Solana is weathering a macro squall with surprising internal strength. While price remains pinned by risk-off sentiment, the ecosystem&#8217;s throughput, revenue and <a href="https://app.blockworksresearch.com/analytics/solana?dashboard=39">developer momentum</a> are intact.



If the market stabilizes and volatility recedes, Solana could quickly reassert leadership in the next leg up. If not, our real test won&#8217;t be whether the network avoids the downside but how well it builds through it. So it has been, and so (someday, though maybe not today) it shall be.



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Lightspeed Newsletter

Solana slides on macro pressure as oil and gold rally

This is a segment from the Forward Guidance newsletter. To read full editions, <a href="https://blockworks.co/newsletter/forwardguidance" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Oil prices surged while global equities faltered Friday morning, on fears that Israel’s attacks on Iranian nuclear facilities could escalate into a broader conflict.&nbsp;



Brent crude, a benchmark for global oil prices, gained more than 8% in the early hours of Friday morning. West Texas Intermediate crude rallied as much as 14% before paring some gains, following <a href="https://www.wsj.com/livecoverage/israel-iran-strike-conflict/card/iran-s-oil-facilities-not-damaged-by-israeli-strikes-mma4B7MvDJPOKACxblQW?gaa_at=eafs&amp;gaa_n=ASWzDAidSyDWPvncLEk3XZUIdfddvMuaoMI05hBctM5nUs1_NTS5h9wEb1w24VihBqQ%3D&amp;gaa_ts=684c4b2b&amp;gaa_sig=1J26WGQjipkVrEQct72Ujf8lnywrX45kNcbXpK4tKrSkVr592IdOSowBBu7uQH5eLxUPAxtqz-olFQ0pZJPEVA%3D%3D">reports from Iran</a> that oil facilities were not damaged by Israeli airstrikes.&nbsp;



Gold approached its all-time high as investors moved toward safe-haven assets.&nbsp;



The S&amp;P 500 and Nasdaq Composite indexes hovered in the red for most of the session, trading 0.8% and 0.9% lower at 2 p.m. ET.&nbsp;



Trading like a risk asset, bitcoin was also in the red on Friday — trading 0.6% lower on the day at 2 p.m. ET to hover around $105,200.&nbsp;



US Treasury yields moved higher Friday morning, signaling investors’ fear that higher oil prices could lead to prolonged elevated inflation. While Treasury prices typically rally on geopolitical uncertainty (remember, prices and yields move inversely), inflationary pressures could impact the Fed’s rate-cutting timeline.&nbsp;



Speaking of the FOMC, this week’s data (more on that below) makes a solid case that while committee members will probably not touch interest rates next week, a cut — or two — before year end may be in the cards. At least that’s what markets were thinking, but geopolitical tensions have given investors reason to pause.&nbsp;



Odds of the first 25 basis point cut coming in September were at 59% on Thursday but dipped to 56% Friday morning, per <a href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html?redirect=/trading/interest-rates/countdown-to-fomc.html">data</a> from CME Group.&nbsp;



The shift, slight as it is, supports the narrative that traders are selling US Treasurys on fears the Fed may keep interest rates higher should oil prices stay higher.&nbsp;



Early reports suggest that the situation in the Middle East will not be resolved quickly; Iran has vowed “severe” retaliation and has <a href="https://thehill.com/policy/international/5348689-iran-nuclear-deal-talks-suspended/">pulled out</a> of a planned nuclear talk with the US.&nbsp;



President Trump on Friday confirmed to reporters that he knew Israel was planning on attacking Iran, but the Wall Street Journal <a href="https://www.wsj.com/livecoverage/israel-iran-strike-conflict/card/trump-told-netanyahu-on-monday-not-to-attack-iran-WfVmW9ddIPeZZYlpOafE?utm_source=substack&amp;utm_medium=email">reported</a> that earlier in the week, he’d asked Israeli Prime Minister Benjamin Netanyahu to stand down.&nbsp;



This paints an uncertain picture, and investors appreciate certainty. So does the Fed. We’ll be back on Monday with a preview of what to expect from next week’s rate-setting meeting.



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Stocks, cryptos lower following Israel strike on Iran

This is a segment from The Drop newsletter. To read full editions, <a href="https://blockworks.co/newsletter/thedrop" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Coinbase announced a stablecoin payment option on Shopify, as well as an American Express credit card, during yesterday’s State of Crypto Summit.&nbsp;



Buyers making online purchases from an estimated two million businesses using Shopify may soon see <a href="https://www.shopify.com/news/stablecoins-on-shopify">USDC on Base</a> as a payment option when checking out, and will have to approve those payments via a third-party crypto wallet.



Shopify CEO Tobi Lutke said during one talk that what a user sees when buying items through the ecommerce site isn’t the whole story. Clicking the “Pay” button initiates many steps on the backend, and adding a price-volatile crypto token can make that even more complicated.



“Stablecoins are obviously key here,” Lutke said.



That said, Shopify has added different types of crypto payment options before — and even tried out offering bitcoin payments <a href="https://www.coindesk.com/markets/2013/11/09/shopify-officially-integrates-bitcoin-as-a-payment-option-for-its-70000-merchants">way back in 2013</a> when it had about 70,000 online stores using its platform.&nbsp;



Shopify’s <a href="https://help.shopify.com/en/manual/payments/additional-payment-methods/cryptocurrency">site</a> already lists Solana Pay, Crypto.com, Strike, and half a dozen other crypto payment integrations as options for businesses to choose to opt into. It’s just not clear how many Shopify merchants are actually going for these options.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Platforms using <a href="https://twitter.com/stripe?ref_src=twsrc%5Etfw">@Stripe</a> Connect can now offer stablecoin payments to their users! This means businesses can: 🌎 reach more markets 💰 at lower cost First out of the gate is <a href="https://twitter.com/Shopify?ref_src=twsrc%5Etfw">@shopify</a>, enabling millions of their merchants to accept payments in USDC! <a href="https://t.co/SDoABDz5uI">pic.twitter.com/SDoABDz5uI</a>&mdash; Jen (@BackseatVC) <a href="https://twitter.com/BackseatVC/status/1933231262585475143?ref_src=twsrc%5Etfw">June 12, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



The USDC on Base payment option is first rolling out in early access, with plans to expand that rollout this year. Lutke <a href="https://x.com/tobi/status/1933237327633265064">said</a> Shopify is also exploring adding 1% cashback, too, as an extra perk.&nbsp;



Stripe’s tech helped make this happen. Merchants can decide whether they want to keep their earnings in USDC or convert it into their native fiat currency.



Both during the livestream and afterwards across different X <a href="https://x.com/ilikesymmetry/status/1933232617991856415">threads</a>, Coinbase execs and staff pointed out that high credit card fees cutting into merchants’ profits are a point of frustration that crypto could solve. They also emphasized that crypto can go across borders to be a truly global payments option.&nbsp;



<h3 class="wp-block-heading">Going premium</h3>



Somewhat ironically, though, Coinbase unveiled its American Express card yesterday.&nbsp;



The Coinbase One Card <a href="https://x.com/coinbase/status/1933237429193806033">uses</a> Amex’s network and isn’t free — but they’re promising 2-4% bitcoin back per purchase. The card will only be available in the US, and will launch sometime this fall. It requires an active Coinbase One Basic ($5 a month or $50 annually) or Coinbase One ($30 a month) subscription in order to apply for the card and keep it valid.



Amex is known for being a premium credit card company with some of the <a href="https://www.fool.com/money/research/average-credit-card-processing-fees-costs-america/">highest fees</a> for merchants.&nbsp;



It’s also known among Amex holders that it can be difficult to find businesses who accept the card outside of the US. (For example, my fiancé and I absolutely struggled earlier this year to find anyone who took Amex during a trip to South Africa. But all shops and restaurants we visited accepted Visa.)&nbsp;



It’s partly in the name: American Express.&nbsp;&nbsp;



American Express sees its brand as increasingly catering to a younger audience <a href="https://www.bloomberg.com/news/articles/2025-06-11/american-express-s-gen-z-customer-spending-grew-by-40-from-2024?srnd=undefined">willing to spend</a> on something that feels like the luxury option. Coinbase also sees itself as a “premium” brand among crypto companies, Coinbase Ventures exec Shan Aggarwal mentioned during the livestream.



I don’t necessarily disagree. Coinbase has long had some of the best user experience product flows and product designs in crypto — though the fallout from a recently-revealed <a href="https://blockworks.co/news/coinbase-breach-fallout-data-exposed">data breach</a> may have eroded some trust in the brand.



For credit card nerds: the Coinbase One card is expected to weigh 17 grams, which is reportedly the same weight as the invite-only Amex Centurion card that costs thousands a year.



<h3 class="wp-block-heading">The audience</h3>



The Coinbase One <a href="https://www.coinbase.com/one">subscription</a> is most ideal for frequent traders who want no-fee Coinbase trades, more staking rewards, and prioritized customer service.



“Amex plays extremely well to Millennials, GenZ, the younger generations,” said Amex SVP of Global Network Services Will Stredwick, who sees crypto as “so obviously becoming mainstream.”&nbsp;



A 2024 PolicyGenius survey <a href="https://www.policygenius.com/life-insurance/2024-financial-planning-survey-millennials-gen-z-money/">found</a> that 22% of Millennials surveyed (now between roughly ages 28 to 43) owned crypto, followed by 20% of GenZ (now between ages 19 and 27).&nbsp;



But just 10% of Gen X and 5% of Boomers said they owned crypto.



The Coinbase One Amex is expected to release this fall. It joins a lineup of other crypto payment cards, including crypto debit cards, credit cards, and others that fall somewhere in-between. This year, we’ve seen a slew of crypto card announcements.&nbsp;



There’s a MetaMask Mastercard, a Gemini bitcoin rewards Mastercard, an <a href="https://blockworks.co/news/avalanche-visa-card-payments">Avalanche Visa</a>, a <a href="https://blockworks.co/news/solayer-launches-crypto-rewards-card">Solayer Visa</a>, and others.



All of these cards beg the question: Was crypto ever trying to get away from the traditional financial system? Or has the industry decided, collectively, that the best way to beat the Visas and Amexes of the world was to join them?



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American Express

Coinbase unveils Amex card, Shopify integration

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FIFA, Maplestory, Off the Grid, <a href="https://blockworks.co/news/inversion-chain-avalanche">Inversion</a>.



These are among the few high-profile names to have launched (or plan to launch) chains on Avalanche’s tech stack lately.



Why Avalanche and not Ethereum?



The answer starts with Avalanche9000, the network’s largest upgrade that went into effect last December. It was Avalanche’s own version of “<a href="https://blockworks.co/tag/ethereum-merge">The Merge</a>,” which radically overhauled validator economics.



As part of ACP-77, Avalanche validator’s high fixed stake cost requirements (2000 AVAX) were replaced with a low-cost, pay-as-you-go model.



Reduced upfront costs have made it attractive to launch a sovereign Avalanche L1 chain — it’s possibly even cheaper than <a href="https://blockworks.co/analytics/celestia">a Celestia rollup</a> or Cosmos Appchain, based on <a href="https://app.blockworksresearch.com/research/avalanche-an-economic-analysis-of-acp-77">estimates</a> by Blockworks Research’s EffortCapital.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcC5wh5L55_81NokAGe0kLQZiJoTaonqTZlT0DBBRCD4eclbMmnbUOpFEJBQCHnNocOK-DcMBDG18ydkowqKmg5vM4i0UH9z4KAO9c6FAFAM1zziZeVccJUla2zQLkBomrdC_UBZQ?key=G9G16ZCPgEDragXxF7V1VQ" alt=""/></figure>



The cost savings go further.&nbsp;



Teams bootstrapping an Avalanche L1 can leverage what the C-Chain — Avalanche’s liquidity hub — has already built out.



For instance, Avalanche L1s can offer users the convenience of a CEX ramp via the C-Chain without having to pay a hefty percentage of their token supply to integrate directly.



“That&#8217;s one of the core value propositions at Avalanche,” Ava Labs chief strategy officer Luigi D&#8217;Onorio DeMeo told me. “From a go-to-market perspective, it saves teams a lot of time and millions of dollars in integration fees.”



This goes for most standard chain infrastructure that the C-Chain already has, such as oracles, RPCs, indexers, explorers, NFT marketplaces, etc. — all of which can cost up to an <a href="https://x.com/AndreCronjeTech/status/1848795057014399440">estimated</a> $13 million for an independent L1 to bootstrap themselves.



It all hinges on Avalanche’s “Interchain Messaging” (ICM) protocol, which Avalanche L1s use to easily move assets to and from the C-Chain to take advantage of the aforementioned features.



C-Chain to Henesys (Maplestory’s chain) is today the most active back-and-forth route on ICM, facilitating thousands of messages daily.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfXdQOnyE9Bq_JpC81F-g4D_tfRiFu6vfOhdZKJsiSYPI8MzrwFAHFbkjTU9IN15cJyAy8jz7t8zfPvB9MAYM4gTeN8a9J6IloX1P5Sh2Z7nXy_2H5aevaz2LnoyqJhkPJDEwxuwA?key=G9G16ZCPgEDragXxF7V1VQ" alt=""/></figure>



Source: <a href="http://l1beat.io">L1beat.io</a>



Value accrual is another major reason to launch an Avalanche L1.



Avalanche L1s can devise clear value accrual streams to their native tokens by bootstrapping their own validator sets and issuing block rewards (or using their own native token as gas).&nbsp;



Ethereum L2s cannot leverage the same levers and therefore have limited or no value accrual streams to their tokens, outside of governance (there are <a href="https://blockworks.co/news/arbitrum-timeboost-live-dao-revenue">exceptions</a>).



Finally, AvaCloud&#8217;s HyperSDK also grants a high degree of L1 <a href="https://x.com/santiagoroel/status/1913308769875882221">customization</a>, a stark advantage over the <a href="https://blockworks.co/news/commonware-optimized-blockchain-development">constraints</a> L2s face building on today’s rollup tech stacks.



<h2 class="wp-block-heading">AVAX value accrual</h2>



Given the problems of value accrual that have plagued ETH and ATOM, it’s worth looking at how AVAX accrues value.



First, 100% of all C-Chain fees are burned, compared to partial burns for Solana or Ethereum. AVAX burn had a monthly average of about $453k in 2025.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXf3tf2Q8EPgPO4DtP3g_ORJvsPgVV5PmRv79JZiDmtp7LqKf2R-bTy_FpoKNWo6j7TEbviCtxCahSJCLyP2dFolHqsYKHM8JkRe3Kb4dN3iQqeVZftw_Uyg9kcNbDkjQTAEKSZE?key=G9G16ZCPgEDragXxF7V1VQ" alt=""/></figure>



Secondly, validators continue to stake AVAX to validate the primary networks — about $8b (360.2m AVAX) is staked today.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfkKBYCiuWhKCulotFp-zbtuePpvl0CTBeP8us7Ys1ZdOub9wemiGCxAe4xuY6PcK8v6aRZZYDA4TwItwayYtqpQybgi2sV572OclENDDl1K_H1uyjjw5KD-UO_c2mho968EdGN6w?key=G9G16ZCPgEDragXxF7V1VQ" alt=""/></figure>



Third, every Avalanche L1 validator pays a small monthly continuous fee in AVAX, as part of ACP-77. Depending on how many validators there are, these fees range from the hundreds to thousands. Blockworks Research’s <a href="https://app.blockworksresearch.com/team/boccaccio">Boccaccio</a> has drawn up some nice <a href="https://app.blockworksresearch.com/research/avax-s-value-capture-problem-and-off-the-grid">estimates</a> here for the Gunzilla chain:



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdfgGzV-KgpVbFP6Qh-dLEC5jH73AjuA3_wFOZjt2-jOh8H5CC4BpIEFmtmS4G9-oVzdUuN_8qyOuRpWdKx6q3h17rBjVzuYDcO6q6m2sG1ejA6CvynOfKS-s3ElHi1ckk_cAuh-w?key=G9G16ZCPgEDragXxF7V1VQ" alt=""/></figure>



Finally, there is a minimal, indirect fee on ICM that is burned whenever transactions interact with the C-Chain.



<h2 class="wp-block-heading">Avalanche’s path forward</h2>



When all is said and done, Avalanche’s business strategy rings familiar: Reduce upfront costs to subsidize long-term growth.



Ethereum is doing the same by forfeiting short-term execution fees to L2s in hopes of attracting data availability fees in the long run. <a href="https://blockworks.co/tag/celestia">Celestia</a> is also practically giving DA away for <a href="https://x.com/musalbas/status/1893975544636563736">free</a> now in pursuit of long-term growth.



A popular misconception of Avalanche is that it does not want to be a fast chain, DeMeo told me — which he claims is untrue.



Both ACP-125 and ACP-176 (Octane) introduced reductions in the C-Chain’s minimum base fees and a dynamic fee mechanism to optimize gas fees — both of which have contributed to a 96% fee reduction since the start of 2025.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeZHG5MBymPSlAwrfyEkqoP0AX7YDht_lVeffAo6La9bnZvSXjS4V3eqTePe4q6_o9S5HxbkKQK9a61HuO8bJ_hPQu404R2eGC48oi_QtLFXUITgDNIdTgJ3bUaOn_h_qdjf113?key=G9G16ZCPgEDragXxF7V1VQ" alt=""/></figure>



Fees will continue to go down as part of the network’s plans later this year to implement “asynchronous execution (<a href="https://github.com/avalanche-foundation/ACPs/discussions/196">ACP‑194</a>),” he said.Value accrual to AVAX has not yet occurred on a substantial level, but a clear path lies ahead. With <a href="https://snowpeer.io/">66</a> active L1s in the Avalanche ecosystem and even more onboarding, Avalanche is well positioned to grow a network effect of its own.



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